PART THREEFull Tide of War

The Autumn of 1942 marked the peak of Axis expansion.
In the South Pacific the Japanese had occupied much of New
Guinea and were threatening Australia. In the North they
had taken several islands in the Aleutians in a thrust toward the
North American continent. In Africa the Germans had slashed into
Egypt and were stalled at El Alamein. In russia the success of the
great eastward rive of the Nazis hinged on the outcome of the siege
of Stalingrad to which the Germans committed 22 divisions in September.
In Europe Allied air warfare had not yet seriously inconvenienced
the Axis in its exploitation of the resources of the continent.
Yet the nadir of Allied fortunes had been reached. On all fronts the
United Nations were able in the latter half of 1942 to check the
Axis spread and to make a start on the long road to victory. In
August the Marines landed in Guadalcanal in a desperate gamble and
successfully resisted Japanese efforts to drive them from the island.
In October, after reenforcing and reequipping their forces, the British
at El Alamein initiated an offensive that was to drive the Germans
from Egypt and westward to tunisia. Early in November American
forces landed in Northwest Africa in an action coordinated with the
British offensive from the east, the two moves being designed to pinch
the Nazis between the British and American armies. In November
the Russians put in motion a vast encircling movement to relieve
Stalingrad and to crush the Nazis in the East. It was not until
May 1943 that attacks could be mounted to drive the Japanese from
American islands in the North Pacific and by that time island-hopping
tactics were under way in the South Pacific.

By the time these military operations were in motion the wartime
structure of the American Government had taken form. The problems
of administration that were to arise after the fall of 1942 were of
a different order than those which had been involved in establishing
and staffing the wartime agencies. New problems arose in the coordination
of the going mechanisms of government and a few major
rearrangements of organization had to be made to deal with new
issues. But in the main after the fall of 1942 the problem of administration
became one of management of the machinery which had been
established. Most of the critical problems that emerged flowed from

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the economic and political effects of the burdens placed on the American
economy by the preparations for the military campaigns under
way and for those scheduled for the future. During 1942 our production
of military and war-related goos for ourselves and our allies
rose sharply toward the peak which was reached in 1943. As military
operations got under way and as the initiation of other actions approached
the demands for war matériel became more imperious.
The demand for goods for war use, the needs of a prosperous civilian
population, and the reduction in the production of many types of
articles for civilian use brought greater and greater pressure upon
price levels. The expansion of production was taking up the slack
in the economy and scarcities of materials became serious while a
prospective shortage of manpower loomed. The civilian population
began to feel the pinch of war and the problem of supplying the home
front became more difficult.

All of these things had their repercussions in the organization and
administration of the Government on the home front. The pressure
on prices and wages required the establishment of mechanisms to gear
together the agencies of the GOvernment with powers useful in stabilizing
the economy. Early in October 1942, the
Office of Economic Stabilization
was established with authority to take the leadership in directing
the activities of Government agencies with powers to affect
stabilization. The intensification of the competition for the output
of the American productive system required improved mechanisms
and procedures to allocate the supply of goods to different uses. New
and better procedures were developed by the
War Production Board
for these purposes. A crisis in petroleum brought a reorganization of
the governmental agencies concerned with petroleum and its products.
Toward the end of 1942 the increasing demands on American agriculture
brought a reorganization of the agencies of Government concerned
with food production and distribution. The declining quantities of
goods available for civilian use required the institution of broader
rationing programs. In September 1942, it was decided to ration
gasoline on a Nation-wide basis. In the spring of 1943, shoes, meats,
and processed foods were rationed.

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Chapter XRegulating the Flow of Materials

An important change took place in the American economy
between the spring of 1942 and the fall of that year. This
change was gradual, but nonetheless dramatic. It consisted
of the disappearance of slackness in most elements of our productive
system and the development of a tight economy in which war production
demands apparently exceeded the Nation's capacity. the most
urgent production programs of the military, naval, and air forces, and
those of the shipping and lend-lease agencies were in violent collision.
The required increases in total production, or in individual types of
production, could not be achieved through the comparatively simple
solutions used in the prior winter and spring.

In the fall of 1942 and winter of 1942-43, four solutions were advocated
for dealing with this new and extremely difficult problem of
expanding war production in a tight economy.
The first proposal, but forward even before the summer, and readvanced
from time to time later, whenever difficulties developed, was
the elimination of civilian responsibility for managing the economy
and the transfer of that power to the military.

The second type of reaction was the desperate effort to get quick
action in solving any immediate problem by giving the responsibility
in a limited field to one man along with a broad grant of powers to
that he might act with vigor and dispatch. The best illustration of
this answer to the problem of war production in a tight economy was
the creation of the Office of Rubber Director, although other "czars"
were set up, and still others suggested from time to time.

The third method was the development under WPB of comprehensive

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integrated controls requiring also the reduction of programs to
feasible limits, their timing on the basis of needs, and the elimination
or postponement of unbalanced programs.

The fourth method was the development under the War Production
Board of the direct and indirect management of production, especially
through the control of scheduling.

It is the purpose of this chapter to review these four methods
of approach and to show how each one of these solutions played its
part in the development of the final pattern of American war production,
a system of controls which on the total record achieved extraordinary success.

Proposals for Military Control

As chapter 5
explains, the idea of military control of the economy in
time of war was firmly held and vigorously advocated by officials
of the War and Navy Departments and the military chiefs at various
times from 1939 on. During the summer and fall of 1942 scores, if not
hundreds, or production lines were closed down for brief periods when
the flow of materials ceased, and the conflict of high military priorities
threatened to strangle the entire war production program, military
and civilian. These temporary crises called for strenuous new
demands from some quarters for military control of the economy.
Proposed plans brought WPB under the joint Chiefs of Staff, or
replaced Mr. Nelson by a military officer or at least by a man with less
susceptibility to foreign demands and civilian requirements whose
primary concern would be for the military program.

Through all this discussion the issues were perfectly plain, though
they were frequently overlooked even by those who were most deeply
involved. The choice was between flexible civilian supervision over
military production and procurement or military domination over the
supply of materials, materiél, essential civilian goods, and manpower.
THough there were times when it looked as if the only way out of the
controversy lay in giving the military final control over the total
economy, the President and the Congress, supported by the Truman
Committee, were never persuaded to make the change.

While the military forces were not accorded final control over the
economy, extensive war production powers were given to the military
establishments from time to time. While these are described elsewhere
in this study, it is appropriate to note certain of these powers here.

It as noted in chapter 5 that the War Production Board delegated
the entire procurement function to the military services, the Maritime
Commission, and other purchasing agencies. Extensive delegation
of the right to issue priorities was a necessary consequence. Military
and naval personnel reporting to high Army and Navy officers or

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to the Army-Navy Munitions Board were brought directly into the
WPB offices all through the organization where they might not only
observe but also influence, if not control, WPB activities and decisions.
And finally, military personnel were given central advisory posts on
the War Production Board itself, on the extremely important Production
Executive Committee which became the major power in WPB
after February 1943, and on the Requirements Committee, as well
as on the Divisional requirements committees. Military personnel
served also on the Area Production Urgency committees and in other
field office posts. In this way the military agencies were not only
represented at every point within the civilian agency designed to
control the economy, but were in a position to delay or recommend
action, both on top policy decisions and in the smallest details, if
the action proposed did not suit their views or desires.

Whenever a particular drive for military demands of the economy
failed as the result of Presidential decision, or because of specific
action by the Chairman of the War Production Board in asserting
his powers, the military leaders took another approach to secure the
same result; they never abandoned the sincere conviction that they
could run things better and more expeditiously than could the civilians.
This approach was involved, for example, in the transition from the
Production Requirements Plan to the Controlled materials Plan,
as is explained below. Similarly, when the WPB, after a bitter struggle
in which the President made the decision, reestablished its right to
control production schedules, the military promptly reestablished, if
it did not actually extend, its influence through the Production
Executive Committee and the staff which surrounded the Executive
Vice Chairman.

War Production Czars

The second answer, in a tight economy, to confusion and delay in
war production was the setting up of men with conspicuous authority
and specific limited duties. These men came to be known as the
"czars." The best illustrations are the Rubber Director, the Petroleum
Administrator, the SOlid fuels Administrator, and the War
Food Administrator. At various times czars were suggested also for
lumber, steel, aluminum, civilian supplies, and electric power.

In every case the history was the same: A serious shortage with
its attendant confusion would develop; the columnists and the public
generally became alarmed; officials with conflicting authorities or
ideas each proposed his own solution, or failed to present immediately
a clear simple plan of action; Congress often commenced to investigate;
and sooner or later someone would come forward with a dramatic

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plan for solving the particular issue by giving one man all the power
necessary to do the job. The author of this plan ignored the existing
organization of production and the chaos that dictatorial powers in
one field could cause in the whole war economy. Corrective reasoning
was generally supplied by the Director of the Bureau of the Budget,
by the Chairman of the War Production Board, or by the Price Administrator,
who represented the agencies most concerned by these moves.

This development of czars is well illustrated in the following accounts
of the origin and experience of the Rubber and Petroleum Administrations.
The somewhat similar story of the development of the War
Food Administration is presented in the next chapter.

Oil

Of the three commodities, rubber, food, and oil, oil was the most
critical. We had lost our supplies in the Far East; the Germans had
the rich Russian fields; and submarines were sinking our tankers in
sight of the Atlantic shores. Our own and Allied demands for oil had
domestic repercussions which led to mobilization of government and
industry to grapple with petroleum problems, first of transportation,
and then of production and distribution.

The pressure for a wartime "oil czar" stems from developments of
the spring of 1941. At that time, the most pressing domestic petroleum
problem was to bring adequate amounts to oil to the Atlantic
coast area. Nearly all such supplies had been brought in by tankers

Chart 33. Price and Production of Crude Petroleum.

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Chart 34. Sales of Fuel Oil to the Military Services.

operating, principally, from Gulf coast ports. A supply crisis was
created by allocation early in May of 50 of these vessels to carry oil
from Gulf and Caribbean ports to northern ports where the cargo was
transferred to ships under a foreign flag for trans-Atlantic shipment,
chiefly to Great Britain. The deficit in transportation facilities could
be met by expansion of rail movements, by construction of additional
tankers, and by extension of pipe lines, but all these solutions required
time and there was immediate need to make more efficient use of
existing facilities both to meet current requirements and to build up
reserves for the winter ahead. Other problems which demanded
attention included efficient development of petroleum reserves, optimum
balance in refinery operations, and elimination of cross hauling
of petroleum and its products.

Something obviously had to be done. The chief difficulty was that
a good many Federal agencies had coordinate interests in oil and its
distribution. Furthermore, coordination could not offer a decisive
solution. The Department of the Interior had jurisdiction over production
of oil on public lands and Indian Reservations, forecast consumer
demand for oil, and engaged in research. The Navy Department
administered naval petroleum reserves and was one of the
principal consumers of petroleum. The Maritime Commission had
charge of tanker transportation and the ICC had jurisdiction over rail
and inland barge-line oil movements. In addition, the War Department,
OPM (which had set up an industry committee for oil), the
Office of Price Administration and Civilian Supply, Lend-Lease, and
other defense organizations had an interest in petroleum.

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On May 28, 1941, a day after he had declared the existence of an
unlimited national emergency, the President sent a letter to the Secretary
of the Interior naming him Petroleum Coordinator for National
Defense,1
with wide advisory powers but with little operational control.
It was obvious that the President recognized both the need for
coordination and the threat to the established forms of organization.

This choice was influenced by the Department's long standing
interest in oil, its available staff, its contacts with the industry, and
the President's confidence in Mr. Ickes. The Coordinator was charged
with two types of functions: He was to assemble data about needs for
petroleum and about factors and actions affecting its supply. He was
also to consult with, and recommend to Federal agencies, State
governments, and the industry, action needed to maintain adequate
supplies. The President requested some 20 Federal agencies concerned
with petroleum to give the Coordinator antecedent advice of proposed
actions which might affect oil supplies and to notify him of meetings
dealing with its problems so that he might make recommendations.
The letter did not transfer powers to the Coordinator from other
agencies already dealing with phases of the petroleum problem. It
simply set up an organization in which available information about
petroleum could be brought together and through which proposed
actions for dealing with oil problems would be cleared. Thus, assignment
of authority over the defense production program continued to
be distributed on functional lines, but an advisory organization with
an interest in the total petroleum problem was set up to make recommendations
to operating agencies which were dealing only with parts
of that problem. If, for example, the Coordinator thought that
unnecessary drilling of wells was consuming steel that could be used
better for pipe lines, he could recommend that OPM issue orders to
prohibit such drilling, but he could not command.

In organizing his office, the Petroleum Coordinator drew on staff
of the Interior Department, and also on the oil industry, from which
he selected his Deputy Coordinator and other officers, and constituted
a national Petroleum Industry Council and District Advisory Committees.
Under terms of an agreement with the Department of Justice,
which was responsible for enforcement of the antitrust laws, he made
extensive use of these groups in planning and executing programs. In
the months before our declarations of war, OPC made Nation-wide
surveys of capacities for production, transportation, refining, distribution,
and equipment and supply requirements of the oil industry. It
prepared and executed plans for expansion of high-octane gasoline
production facilities and for supplying petroleum to Great Britain and

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the Soviet Union. For OPM, OPC acted as an industry branch,
advising, recommending, and passing on priority applications,
preference ratings, and limitation and curtailment orders. American
entrance into the war aggravated these and other problems with which
OPC was grappling and made their solution more difficult.

Public annoyance with inconveniences and conflicting statements
about supplies of gasoline and fuel oil, the petroleum industry's
dissatisfaction with actions of Government agencies--particularly
with OPA's price policies, and the Petroleum Coordinator's desire for
greater authority for discharging his responsibilities led to attempts
to strengthen the powers of the Office of Petroleum Coordinator. In
Congress, an unenacted bill would have vested in a National Petroleum
Administrator "all functions of the War Production Board and its
Chairman, of the price Administrator, and of the Office of Defense
Transportation, relating to the production, transportation, distribution,
sale, or price of petroleum." In the Executive Branch, the
Petroleum Coordinator spearheaded the drive for greater OPC
authority. As early as September 1941, the President had rejected
his request to delegate to the Coordinator power to determine priorities
and allocation of supplies for crude petroleum and natural gas. In
1942, however, the Petroleum Coordinator succeeded partially in
his renewed efforts to increase his authority.

As an organization to collect information and to make recommendations,
OPC experienced difficulties in its relations with a number
of other agencies. OPC, which had tackled oil transport problems
several months before the creation of ODT, was inclined to feel

Chart 35. Civilian Use of Petroleum Products.

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that tank cars could be treated largely apart from other transportation
facilities, a view with which ODT, which had over-all jurisdiction
was not inclined to agree. There was friction between OPC and the
Board of Economic Warfare over matters such as supplies for oil
producers in foreign countries. In WPB, which continued the OPM
practice of using OPC for processing priority applications and recommending
limitation and conservation orders, there was general agreement
on high priorities for materials needed for high-octane gasoline
plants to supply the needs of our huge plane-production program;
but there were differences over other issues, particularly the construction
of pipe lines, steel for which competed with material for bombs,
tanks, ships, and other military requirements. OPC relations with
OPA were strained by continuing differences of the urgency, extent,

Chart 36. Production of Motor Fuel.

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and methods of oil rationing about which the agencies issued conflicting
press releases. OPC also felt that OPA was too slow in
approving price increases to offset higher costs of transportation
(resulting from shifts in movement of petroleum from water to land)
and less profitable refinery yields. These interagency frictions,
especially those over prices, came to the attention of the President who
asked the Petroleum Coordinator if there were any way all the handling
of oil could be put in one place. In reply, the Coordinator wrote,
on August 19, 1942, that, although a great deal had been accomplished
under his existing powers, it was necessary to centralize authority
over oil more clearly and positively. To accomplish this purpose he
submitted a draft of an Executive order to create a Petroleum
Administration for War.

The President referred this draft to the Bureau of the Budget
which undertook to reconcile the views of the agencies affected, a
process that required the 4 months between August and December
1942, when an Executive order, considerably less sweeping than the
original proposal, was issued. Since these negotiations involved one
of the major threats to the established pattern for war production,
it will be useful to use them as an example and to review them in some
detail to bring out the character of the controversy over functional
and commodity organization. Two related issues may be distinguished:
location of the petroleum agency, and the scope of its authority.

The Coordinator had proposed to place the new Petroleum Administration
in the Executive Office of the President rather than in
the Department of the Interior, though, like OPC, it could have been
given independent status with direct access to the Secretary and freedom
from internal departmental routines. The Bureau of the Budget
thought it would be a fiction to locate the new Petroleum Administrator
in the Executive Office and preferred an autonomous agency
within the Department of the interior. A third solution, advocated
by the War and Navy Departments, OPA, and WPB (whose chairman's
earlier attempts to get it adopted had failed) was to put the
oil agency in WPB, on terms similar to those applying to the recently
established Office of Rubber Director, so that its activities might be
related better to actions affecting the rest of American industry. The
Petroleum Coordinator, who had turned down an invitation to become
a member of the War Production Board, was reported to have
conceded the logic of such an argument but to have objected to
incorporation of his agency into WPB as long as its then chairman,
with whom he did not get along well, remained in office. Another
obstacle to the transfer of the oil organization to WPB was confusion
in the Board resulting from an internal reorganization in the fall of

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1942. In the end, the Petroleum Administration was set up technically
outside the Executive Office, the Interior Department, and WPB;
and its head was authorized to report directly to the President.

More significant than location, however, were the powers of the
Petroleum Administration. The Coordinator had written to the
president that his draft order did not expand existing OPC authority
substantially except over prices other than those to consumers, and
in the exercise of priority powers within the oil industry. Possibly
because language in the proposed order was not sufficiently clear,
possibly because they were excessively suspicious of potential encroachments
on their own jurisdictions, other agencies affected professed
to read much greater power into the draft order than did the
Petroleum Coordinator. The latter expressed willingness to modify
the document, which underwent extensive revision before it was
issued. The basic issue, as noted already, was the principle to be
followed in organization for war production. The Coordinator advocated
that authority to take action, as distinguished for making
recommendations, to a substantial extent should be vested in the
petroleum agency. Other agencies, with economy-wide responsibilities,
objected strongly to diffusion of authority over production,
transportation, price stabilization, foreign traded, and other functions
which cut across all industries and commodities. The Bureau of the
Budget sided with these agencies on the grounds, summarized in a
memorandum to the President, that the functional principle had been
followed in organization since the start of mobilization; that it would
be utterly confusing to try to employ simultaneously both functional
and commodity or industry organizations; and that drastic change
of the basic pattern in the midst of war would create confusion and
result in stoppages that the country could ill afford. The difficulties
inherent in the organization suggested by the Petroleum Coordinator
can be brought out best by a review of his original far-reaching proposals,
the reactions of other agencies that were affected, and the much
more moderate provisions of the Executive order finally issued on
December 2, 1942.2
More than a dozen agencies had a substantial
interest in the powers of the proposed petroleum agency, but the
broad issues of "commodity" versus "functional" organization will be
posed clearly enough by consideration of provisions applicable to only
five of them.

Transportation.--The order submitted by the Coordinator would
have authorized the Petroleum Administrator to issue and enforce
specific directives to the oil industry on the transportation of petroleum.
The War Shipping Administration and the Office of Defense

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Transportation would have determined the number of tankers, barges,
tank cars, and tank trucks available to transport petroleum, but the
Petroleum Administrator, in collaboration with these agencies and
the War and Navy Departments, would have allocated these facilities
among the various services and among units of the petroleum industry.
He would have been empowered to direct the construction and operation
of petroleum pipelines. Also, he would have advised the War
Production Board Chairman what materials were needed for transportation
of petroleum.

Detailed control of specific operations such as that proposed by the
Coordinator ran counter to the prevailing conception of war production
organization, under which supply agencies merely set goals for
total movements, and very likely would have interfered with attempts
to achieve a balanced and over-all plan for the flow of traffic.

The War Shipping Administration, which had been dealing directly
with the Army, Navy, and lend-lease in allocating tankers, objected
to establishment of a second agency to allocate shipping, and declared
its intention to continue to be guided by OPDC recommendations in
making allocations to units of the oil industry. Under the order
issued by the President, the Petroleum Administrator was merely to
consult WSA about tanker assignments and to recommend allocations
of available assets.

The Director of the Office of Defense Transportation found it
"difficult . . . to see how an important part of transportation can
be wisely separated from the total transportation without adding to
duplication and conflict and without impairing the effectiveness
of public control." His objections were met substantially in the
order finally issued. Transportation was excluded specifically from
definition of the* oil industry over which the Petroleum Administrator
was given certain powers. ODT was to continue to make recommendations
to WPB for materials needed for transportation not only
of oil but also of other products. Instead of allocating barges, tank
cars, and tank trucks among units of the* oil industry, the Administrator
was simply to designate the quantity and kinds of petroleum to
be shipped and received by those in the industry and to certify these
designations to the Office of Defense Transportation for provision
of necessary transportation. The Petroleum Administrator's authority
over pipe lines, also, was limited: he was to review plans for their
construction, approve those he thought necessary, and recommend
material requirements to the War Production Board; and he was to
direct their physical operation to the extent of prescribing the petroleum
to be transported, and the direction of flow, through such
pipe lines. These powers were subject to ODT's existing authority

Economic Warfare.--The Coordinator proposed to give the Petroleum
Administrator authority to determine, in collaboration with the
State Department, Lend-Lease Administration, and the Board
of Economic Warfare, the amounts of oil required by foreign nations.
The Executive Director of BEW criticized this provision, among
others, on the ground that "any economic warfare program depends
largely for its success upon the authority to coordinate and direct the
movement of all gods in international commerce." Control of the
flow of oil was a vital weapon whose use had to be coordinated with
that of others in the economic arsenal. Collaboration between BEW
and OPC already was provided to some extent through OPC's membership
in BEW's Foreign Petroleum Policy Committee.

In the end, the Petroleum Administrator was empowered merely
to collaborate with agencies authorized to determine plans and
policies for foreign petroleum activities; and his orders to the domestic
industry with respect to their foreign acitivites were to conform to
such plans and policies. The Administrator, however, was to be the
channel of communication on foreign petroleum between Federal
agencies and the oil industry.

Price Control.--The oil industry's dissatisfaction with prices
allowed by the Office of Price Administration for petroleum products
was one of the principal motives behind the proposal to set up an
"oil czar," from whom the industry expected more sympathetic
treatment. To this end, the Coordinator's draft order would have
transferred from the Price Administrator to the Petroleum Administrator
the former's powers over petroleum prices under the Emergency
Price Control Act of 1942. The sole qualification was the Price
Administrator's approval of prices to ultimate consumers, in reviewing
which he was to consider only their effect on general price levels.
If the Petroleum Administrator, whose principal responsibility was
to provide adequate supplies of oil, had been given this power, it
was not unlikely that he would have given more consideration than
had OPA to use of prices to facilitate operations of the oil industry
and less attention to the general problem of stabilization and prevention
of inflation. The Price Administrator pointed out that the
power of approval left to him would be "wholly ineffectual" because
prices to ultimate consumers are determined largely by prices at
earlier levels, over which he would have no control and because it
would be difficult or impossible to demonstrate concretely a threat to
the general price level.

In the final order, the Price Administrator's authority was preserved
and the Petroleum Administrator was limited largely to advisory

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functions. The latter was to compile data about petroleum
prices, to consult with the former, and to recommend revisions of
petroleum prices to him. The Price Administrator, in turn was to
advise with the Petroleum Administrator before establishing or changing
oil price schedules.

Rationing.--The Coordinator's draft order would have required the
Petroleum Administrator's approval of oil rationing orders before
they were issued. Thus, one agency would have been authorized to
approve the methods of another agency with general responsibility
for administering the rationing program. the Price Administrator
pointed out that "detailed policy formulation cannot be successfully
separated from the actual administration and operation of programs . . .
Apart from then evil of divided responsibility, the additional time
consumed in clearance is not unimportant." As the Executive order
was issued by the President, it provided simply that the Petroleum
Administrator should be advised of all proposals for civilian rationing
and that he should consult with rationing authorities in their development.

Priorities and allocations.--The proposed Executive order would
have vested in the Petroleum Administrator substantial powers which
were being exercised by the War Production Board Chairman. The
Petroleum Administrator would have obtained determinations of
military oil requirements from the War and Navy Departments, and,
in collaboration with others, would have determined the amounts
needed by foreign countries and for essential industrial and civilian
uses. He would have advised the WPB Chairman about material
necessary to meet these requirements; and he would have issued
directives to distribute materials allotted to the industry by the WPB
Chairman. He would have had general authority to issue and enforce
specific directives to the oil industry on practically all phases of its operations.

The WPB Chairman opposed the draft order strongly on the ground
that it would interfere with his exercise of priority and allocation
powers. He suggested that, instead of strengthening OPC as a separate
agency, it would be "more efficient and rational" to transfer it
to WPB. This shift was not made, but the President decided that
WPB should retain full control over materials and priorities.

Under terms of the Executive order finally issued and agreed to
by the WPB Chairman,3
the Petroleum Administrator had the following
authority and functions: (1) He was to obtain estimates of oil
requirements, compile and analyze them, and submit them to WPB
with recommendations for allocations. After the WPB Requirements

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Committee determined oil allocation to the several claimant agencies,
the Petroleum Administration for War was to act as a War Production
Board operating division in implementing them. When rationing
was adopted to maintain adequate supplies of petroleum the Petroleum
Administrator was to determine, after advising with WPB, the
areas and times of rationing and the amounts of oil to be available
for it. (2) The Petroleum Administrator was to prepare and recommend
estimates of material needed by the industry to make available
petroleum to meet the oil allocations he recommended; and he was
to control distribution within the industry of the material made
available to it. ()3) Finally, the Administrator was given authority
generally to issue to the industry, and to enforce, directives and orders
dealing with production, refining, treating, storage, shipment, receipt,
and distribution of petroleum and its products.

The effects of this grant of authority which was to be exercised
subject ot policies and directives of the WPB Chairman, were less
far-reaching than they appeared. To a very substantial extent,
WPB had recognized OPC as an industry division and had followed
its recommendations with respect to the oil industry's material needs
and the allocation of petroleum. Formal recognition of PAW as an
operating division of WPB, by giving the Petroleum Administrator
authority to issue directives to the industry, however, did relieve the
Board of certain time-consuming functions.

The Executive order on petroleum issued in December 1942 watered
down the draft submitted by the Petroleum Coordinator in August
by limiting the PAW's functions largely to advice and recommendations.
It safeguarded the powers of other agencies further by reciting
their authorities, which the order was not to be interpreted as limiting.
The attempt to create an oil "czar," then, had only a very moderate
success. Those, like the oil industry, who favored the Petroleum
Coordinator's original draft failed in the attempt to exempt petroleum
from the authority exercised over all commodities by agencies
set up to deal with production, prices, and other "functions" that cut
across all industries and commodities. THus, the basic functional
pattern of organization for war production was retained despite the
position of PAW outside of WPB4--though
the issue was soon to be
fought again in connection with coal. Ickes became, in fact, a liaison
agent between the oil industry and the WPB.

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Rubber

Like oil, rubber was a commodity for which there were universal
demands, many of which could not be filled; but while in petroleum
and solid fuels the principal bottlenecks were transportation and labor,
in rubber the most critical factor was the raw material. Over ninety
percent of our crude rubber imports were cut off when the Japanese
attacked Pearl Harbor, and prospects of substitute supplies from
South America were uncertain. Facilities to process crap rubber
were limited and reclaimed rubber could not be used in all cases as a
substitute for crude rubber. The country was "basically dependent
upon synthetic rubber," as the following data make amply
clear:5
On July 1, 1942, there were on hand 578,000 long tons of crude rubber,
with imports of 53,000 tons more expected by January 1, 1944, making
a total supply of 631,000 tons. Without allowance for passenger
automobile tires, military and other essential demands between July
1942 and January 1944, amounted to 842,000 tons. THus, the deficit
to be met by synthetic rubber was 211,000 tons. little of this could
be produced during 1942. Under programs already scheduled, however,
it was estimated that during 1943 manufacture would amount
to about 400,000 tons of buns-S, 30,000 tons of neoprene, 62,000 tons
of butyl, and 24,000 tons of thiokol--enough synthetic rubber to
offset likely deficits in crude rubber during the critical year 1943.
Only neoprene and buns-S were suitable for combat and heavy-duty
tires. The schedules for these synthetics would provide a safety
margin of 100,000 tons; but, if they lagged as much as 4 months, there
would not be enough to meet the requirements of mechanized warfare and
the need to keep civilian America on wheels. Concern with the
problem found expression both in Congressional and in Executive action.

Late in July 1942 Congress passed S. 2600, a bill to create a new,
independent rubber supply agency headed by a director appointed by
the President with Senatorial approval. The agency was to provide
a supply of rubber, which, added to other sources, would be adequate
to meet military and (apparently, all) civilian needs. It was also
to provide an adequate supply of alcohol produced from agricultural
products. The agency would have been empowered to provide the
plants and materials needed for making synthetic rubber; and
materials which its director certified he needed would have ha
priority over all other deliveries. In vetoing this measure on August
6, 1942, the President set out forcefully to case against diffusion
of the priorities and allocations powers which, by delegation, he had

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concentrated in the War Production Board "in order to carry on
a unified, integrated, and efficient program of war production." He
pointed out that plants already were being constructed by the
RFC's
Rubber Reserve Company and the Defense Plant Corporation under
a WPB program to establish capacity to manufacture 800,000 tons
of synthetic rubber annually. The President took note of charges
that "the manufacture of synthetic rubber from grain has been
hamstrung by selfish business interests" and of "many conflicting
statements of facts concerning all the elements of the rubber situation."
He informed Congress that he had appointed a committee, consisting
of Bernard M. Baruch, James B. Conant, and Karl T. Compton, to
investigate the whole problem and to make recommendations to him.

In its report to the President on September 10, 1942,6
the Rubber Survey COmmittee reviewed estimates of requirements and supplies,
recommended measures for conservation and production of rubber, and
proposed administrative reorganization. To conserve the available

Chart 37. New Supplies of Rubber.

--29--

supply of rubber, the Committee outlined a rationing program that
included gasoline rationing as "the only way of saving rubber."
To increase supplies, the Committee recommended that the existing
synthetic program should be "bulled through" and that an additional
margin of safety should be provided by increasing the program from
800,000 to 1,100,000 tons annual capacity. To insure that the
program would be carried through effectively, the Committee advocated
an immediate administrative reorganization.

The Committee cited the following examples of poor administration
under the existing set-up: Conflict between the Rubber Reserve
Company and the Office of Petroleum Coordinator had delayed the
bringing in of new facilities for production of butadiene, a component
of buns-S. Under an agreement with four large rubber companies, only
Ribber Reserve could give out information about synthetic rubber
processes to others; but the WPB Rubber Branch had to work 6 weeks
to get such data released. In spite of Soviet offers to make it available,
information about long-used Russian methods for making synthetic
rubber had not been obtained. None of the agencies carrying out the
$600,000,000 rubber program had set up a clearly recognized group
of experts to make technical decisions in the highly complicated program.

To overcome difficulties such as these, the Committee recommended
"complete reorganization and consolidation of the governmental
agencies concerned with the rubber program." It was critical of
WPB's handling of the rubber problems and, at first, was inclined to
propose an independent Rubber Administrator who would report to
the President through the Chairman of WPB. After discussion with
members of the Bureau of the Budget, however, who pointed out the
objections to transferring priority and other powers from the central
production agency to one concerned with only a single commodity, the
Committee decided to recommend that the Rubber Director should
be located within the general framework of WPB and that the Board's
Chairman should delegate to him complete authority over manufacture
of rubber. These and related recommendations were incorporated in
orders issued subsequently by the President and the WPB Chairman.

Executive Order No. 9246, drafted in the Bureau of the Budget
and signed by the President on September 17, 1942,7
contained the
following provisions: The Chairman of WPB was directed to assume
full responsibility for, and control over, all phases of the Nation's
rubber program. Within WPB and under its Chairman, there was to be
a Rubber DIrector to administer the program. The Director was
authorized to direct other Government agencies, including RFC,
OPC, BEW, ODT, OPA, and Agriculture, to execute aspects of the

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rubber program and these agencies were instructed to give full compliance
to his directives. Plant construction was to be supervised by
the Rubber Reserve Company. OPC was to do developmental research
on butadiene from oil and to supervise operation of butadiene
plants. The Price Administrator's powers under the Emergency
Price Control Act of 1942, however, were not limited by the Executive order.

On September 15, WPB Chairman Nelson appointed William M.
Jeffers, President of the Union Pacific Railroad, to be Rubber Administrator
in complete charge of the entire program. Five days later,
he delegated to the Rubber Director all the powers conferred on him
by Executive Order No. 9246. He abolished the Office of Coordinator
for Rubber and the Rubber and Rubber Products Branch in WPB,
whose functions, personnel, and records were inherited by the Rubber
Director. Later, the rubber functions of the Division of Civilian
Supply were transferred to the Office of Rubber Director, which
continued to operate until September 1944, when it was replaced by a
Rubber Bureau under the WPB Operations Vice Chairman.8

The Rubber Office had been created within WPB, so the functional
pattern of the war production organization had been preserved. Structural
symmetry, however, did not insure harmony among various
parts of the Government's machinery for industrial mobilization. On
the contrary, the Director's aggressiveness in "bulling through" the
Baruch Committee program brought him into collision with administrators
who had responsibility for other phases of the war program
and also with members of Congress. Two general problems were involved.
First, it was necessary to relate the Office of Rubber Director
to the rest of the WPB organization. Second, the program for construction
of rubber plants had to be integrated with other programs,
such as those for aircraft and escort vessels, which competed for materials
and components required for such plants.

Since the Rubber Director was part of the WPB organization, it is
not surprising that, in some ways, fuller authority was delegated to
him that was vested in the oil and coal"czars" who were outside the
Board. In effect, the definition of the Director's authority amounted
to slicing rubber out of the general structure of
the WPB.9
Though the surgery was less extreme that the Rubber Director sought, from
time to time, the position of the Rubber Director's office (ORD) was
more favorable than that of WPB industry branches for other

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commodities.10
(1) Requirements: ORD was designated as the claimant
agency before the WPB Requirements Committee for critical materials
and facilities needed for construction and alteration of rubber plants
and for raw materials needed in rubber manufacture. Construction
requirements were to be presented through the Facilities Bureau,
while those for maintenance and operation were to go through regular
channels, though the Rubber Director had wanted to bypass them.
(2) Allotments and allocations: (a) The Rubber Director was authorized
to allot rubber among claimant agencies and for civilian requirements,
with the advice of a Rubber Requirements Committee
consisting of the principal using agencies and ORD's Domestic Requirements
Section. Allotments were to be submitted to the WPB
Requirements Committee for determination of their consistency with
over-all production programs approved by the Board. After determining
allotments, the Rubber Director was authorized to make specific
allocations of rubber to manufacturers and for civilian requirements.
For this purpose, for issuance of limitation orders, and for control of
rubber stock piles, the WPB Chairman delegated priorities powers to
him. (b) The Rubber Director's request for authority to allot critical
materials for construction, maintenance, and operation of specific
rubber plants was not approved by the WPB Chairman, who later
specified that the Rubber Director's authority did not extend to
distribution of materials other than rubber or its products even when
they were for use in rubber production. This reservation meant that
the power to allocate the critical component parts required by competing
war production programs would remain concentrated within WPB.

Final Status of Czars

The rise of commodity czars resulted from a very real need of
industry for liaison agents with production agencies. At first the
czars threatened the existence of a functional stabilization, but in
the end they strengthened it. Jeffers' insistence on securing components
for his rubber factories emphasized the need for a unified
control over all processes of production, rather than control through
allocation of materials. Similarly, Secretary Ickes' demands for
complete control over petroleum and its pricing and allocation ended
by giving him extensive control over petroleum and its production

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and distribution, but within the existing framework of production.
The WPB controlled materials, and the OPA, prices.

The adjudication of these attempts to establish one-man controls
over commodities also illustrates the difficulty in trying to find a
definite pattern in the flexible system of our wartime administration.
Both Ickes and Jeffers became liaison agents between an industry and
the Government, but one reported directly to the President; the other
remained subordinate to WPB--the decision reached showed the care
with which the President tried to fit th case to the man, to the
industry, and the real need.

Thus, in the long run, in spite of the publicity given to the czars,
very few were set up, and these few were extensively tied into the
general structure of the over-all war production controls. In World
War II, there were in the United States no such centers of single
commodity authority as were represented by the independent food
and fuel administrations of the prior war.

Comprehensive and Integrated Controls

The third answer to the difficulties of production in a tight economy
was the effort to develop new integrated controls for the whole war
production program. This effort involved new methods of comprehensive
programming, cutting programs back to feasible totals, balancing
production within these totals, allocating materials on a time schedule,
month by month, and quarter by quarter, and clearing production
bottlenecks with new scheduling and directive powers.

The steps by which this third method of approach was finally
carried through, and the organizational changes which it required in
the structure of the WPB, are described in the following pages of
this chapter.

The Time Element

When the stringency of the economy compelled a decrease in
production plans, program planners had to introduce the element
of time into their calculations. A stated production requirement
might stand still. If the total requirement had to be reduced, however,
closer attention had to be given to maintaining a balance within each
program and between the various programs. While this was highly
desirable from the first, it was imperative as soon as the time element
was introduced, so that at given target dates for major military
actions there might be available a balanced complement of troops,
transports, escort,s landing ships, mechanized equipment, air protection,
guns, ammunition, gasoline, quartermaster and medical supplies,
and a certain flow of services, munitions, and supplies for the operation
from that point on. All of this called for "synchronizing the flow

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of material with the time element of the program"--to take a phrase
from Donald Nelson. It was the time element which thus made it
necessary to interrelate the programs.

Though this synchronization was generally recorded in terms of
materials, the top decisions were actually made in airplanes, tanks,
ships, high-octane gas, pipe lines, and other end products where were
to be finished by a given date.

Program Cut-Backs

A major first step in getting war production on a maximum basis,
strangely enough, was the reduction of the grand totals sought in a
given period. These reductions in major production programs carried
the expressive title of "cut-backs."

Our economy is apparently much like the camel and ceases to keep
going when the load is increased by "the last straw." The problems
arise with the high-pressure demands by individual procurement officers,
each of whom "must" get his tanks, or rifles, or shoes, or landing barges,
or packing boxes, or beef, by a given date in the near future, and who
is convinced that no other demand is half so pressing as his. This
is followed by the placing of contracts wherever a producer can be
found. The producer then starts to hire workmen, get more machinery
to increase his output, and to place orders for steel, wool, lumber,
ball bearings, leather, oil, valves, and everything else. As these
orders accumulate, they exceed the possible capacity of the suppliers
of raw materials, and these start to expand, hiring more men and ordering
more machinery. The machine-tool manufacturers and the mines
in turn are in the same fix; they cannot fill their orders without expanding.
And so it goes, everybody getting in the way of everybody
else, until, instead of increased production, there is the threat
of industrial self-strangulation in the effort to do more than is possible.
In the end, nobody can operate efficiently because everybody is out of
something--coal, or steel, or manpower, or machinery, or cotton, or
paint, or soda, or any one of the other thousand things which must
be available at the right time, the right place, and in the right quantity
to keep the wheels turning and the goods flowing.

Some statistics will show that we were heading into just such a
situation during the early years of the war. When WPB added up the
production programs of the various services in January 1942, incomplete
as were these programs, it found they came to about $60 billion
for the year 1942, over against a theoretical feasibility estimate of
about $40 billion. While American labor and industry fooled the
experts and actually produced 10 percent more than the theoretical
maximum, that was still far short of the $60 billion sought by the

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Chart 38. Production of Selected Basic Commodities.

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services in their scramble for equipment. Similarly, the figure for
1943 was even worse, being some $45 billion out of estimated balance.
Such discrepancies were not mere "straws"; they were sure to break
the camel's back.11

No amount of juggling things around or establishing controls could
meet this situation. There is no way of adjusting a load which is
simply too heavy to carry. So the answer was cut-backs, without
which all the rest of the program of control and Government guidance
was futile. The story of the Army supply program which covers
well over half of the total war production for 1942 is revealing.
On February 1, 1942, it was set at $62 billion for the year 1942. This
was cut on April 6 to $45 billion, and on May 29 to $38 billion. On
September 1, however, the program was pushed up to $40 billion,
only to be cut back to $31 billion on November 12, approximately
the actual production achieved for the year.12

Similarly, the aircraft program went through many permutations,
measured both in numbers and in weight, as the new models became
heavier and faster. On numbers alone, from January 31, 1942, to
July 12, 1945, there were 16 "schedules," numbered from 8-I to W-15,
four of which had both "initial" and "ultimate" objectives. Production
for 1942 was scheduled all the way from 69 thousand planes to
47 thousand planes in four programs; 1943 saw 10 different schedules
running from 88 thousand planes up to 109 thousand, and then back
again to 86 thousand. The merchant marine program, however, went
through the year 1942 at about 8 million tons, substantially as originally
planned, though at one stage it was temporarily lifted to 9
million tons.

These and other program reductions, though made by the services
under WPB pressure, were not accepted without a most vigorous
struggle, a struggle fought in terms of steel, copper, aluminum, tin, and
other strategic materials.

Review of Programs

Next in importance to "cut-backs" was the systematic review of
programs by the impartial staffs of the WPB to see if the claimants
really needed as much as they asked, and as fast as they asked it.
This critical review of material demands, not only brought about
important reductions in inflated demands, but also revealed the
all-too-human propensity of energetic supply officers, determined
not to fail in their assignments, to overlook completely the needs
of other services and other needs of the total economy. At the very
beginning there were failures to plan for enough, but from February

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1942 on, the errors were all the other way, the tendency to overorder,
to overcompute in translating from tanks to tons of steel, for example,
to overestimate the needs for spares and the use of ammunition, except
for the foreign orders, and above all, to set completion dates ahead
of real needs based on other complementary parts of the total program
was almost universal. Many supply officers were caught trying to
complete in 1942 end products which would have been stored for
2 years before they were scheduled for shipment, while the steel,
textiles, and valves going into them were holding up articles which
turned out to be critically needed in 1943 for the African landings.
In certain shipyards, steel was found which could not be put in place
for 18 months, at the very time that escort vessels for combating the
submarines were in immediate demand. Many contracts for components
also were permitted to run after the major end product had
been superseded.

It was not unexpected to find that few, if any, supply officers knew
about, thought about, or cared about any other part of the program
than their own. But it was surprising to discover haw passionate,
tricky, and ill-balanced men can become because of short-sighted
overloyalty to their own programs. Most of the anguish of war-torn
Washington arose not from the inherent difficulties of organizing for
war, but from the frictions engendered by energetic men who sought
the success of their own programs, had no time or inclination to think
about the total effort or its many interrelated parts, and had no
ability to discriminate between the exasperating obstacles of inertia
and the essential barriers of coordination. IN such situations, the
impartial review of programs and schedules by men concerned only
with the total success of the whole war production program proved
not only essential, but actually more often than not, helpful for
the individual programs thus brought into better balance within themselves.

Program Balance

The effort to introduce balance into the conflicting production programs
thus became a major necessity in the fall of 1942. While
various glaring inconsistencies had been pointed out before by the
WPB Planning Committee and others, the first full-scale attack on
the problem came through the reports of the BUreau of Statistics at
the meetings of the War Production Board on August 18, September
22, and November 2,4 1942. At the last meeting, Stacy May, Chief
of the Statistics Bureau, not only exposed the wide gap between
first-of-month schedules and actual deliveries under the unbalanced
and unrealistic programming, but demonstrated that the situation
was getting steadily worse, and pinned the blame directly on the procurement

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officers of the Army, Navy, and Air Forces, In the meantime,
at the Board meeting of October 6, Robert Nathan presented
the feasibility report of the Planning Committee, showing that the
sum total of unbalanced programs, which stood at $115 billion for
1943, was beyond the realm of possibility.

The following further conclusions from this report of the Planning
Committee deserve repetition:

The analysis reveals imbalance in the sense that production is well above schedules
for some easy items; and significantly below for the harder items with which
the easy items are to be combined to yield a usable end-product. The is an inevitable
consequence of a huge program flooding the channels of production without
a careful, unified control . . .

While the pressing problem for the immediate future is to correct this imbalance
by curbing the items that are ahead of schedules and concentrating effort on the
items that are behind, we must not overlook the fundamental basic source of
the trouble. There can be no efficient production control without production
schedules; there can be no meaningful production schedule without a set of well-formulated
and properly screened and tested objectives, spelled out over time and
in respect of the relative importance of the various categories and end products;
and there can be no such set of objectives unless there is a competent body, taking
responsibility for formulating them in broad terms, and seeing to it that the
spelling out in detail does not contravene the fundamental considerations that
determined the program in its broad outlines . . .

What we urgently need is an authoritative body that would represent fully
and competently the strategic, economic, and political (in the sense of broadly
social) factors that must jointly determine a well-formulated production program . . .

While high goals were recognized as an incentive for all-out production,
WPB took the position that impossible goals had become dangerous
because they (1) throw production out of balance, (2) justify
excess production capacity, (3) result in failure to meet targets for
other and often more important parts of the program, (4) produce
inflexibility, (5) increase difficulty of effectively controlling flow and
distribution, and (6) prevent coordination of production program
with those of other nations.13

While various general,s admirals, and under secretaries rose at
subsequent meetings of the Board to defend their own programs
and to demand the elimination of various civilian products, they did
go back to their offices and begin to introduce some balance and some
recognition of feasible time limits into their own production programs,
and the Chairman of WPB, with the backing of the President, asked
the joint Chiefs of Staff to revise their total program. Mr. Nelson
also concluded that WPB would have to take over and exercise a
greater degree of control over the balancing and timing of programs
one against the other.

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This balancing, and the elimination of production bottlenecks
arising from lack of balance and timing were sought through two
important innovations, the introduction of the Controlled Materials
Plan under Mr. Ferdinand Eberstadt, and the introduction of controlled
scheduling under Mr. Charles Wilson, both of whom were
appointed Vice Chairmen of WPB during the third week in September, 1942.

Reorganization of WPB

The appointment of Mr. Eberstadt and Mr. Wilson, with the duties
assigned them, constituted a major reorganization of WPB, a reorganization
which called for from Mr. Bernard Baruch in a telegram
of October 1 to the President these glowing words:

I feel that the WPB is not at last reorganized on the proper lines and headed
in the right direction, and that in the next 60 days we will see the commencement
of a large increase in production in every line that we wanted. I feel much
encouraged on the production outlook.

The new organization was, however, not put into administrative
orders immediately because of the difficulty of drawing a sharp dividing
line between the functions assigned to the vice chairman in charge
of program and the flow of materials, Mr. Eberstadt; and the vice
chairman in charge of production and scheduling, Mr. Wilson.

November 11 Reorganization Order

Mr. Eberstadt proceeded immediately to standardize, clarify, and
integrate the industry and material divisions and the programming
activities, put under his direction. This was accomplished in part
through the issuance on November 11, 1942, of a WPB administrative
order drawn by Mr. Eberstadt with the staff aid of Maj. Gen. C.F.
Robinson from the Army Service Forces Control Division, the WPB
Office of Organization Planning and representatives of the Bureau
of the Budget.14

There were several important elements in this new organizational
set-up. First of all programming and operations, which had existed
independently and on the same plane of authority under the prior
organization, were now brought together under a single authority,
that of the program vice chairman. This meant that Mr. Eberstadt
would sit as the presiding officer of the Requirements Committee,
listen to the claims advanced by the Army, the Navy, the Air Forces,
the Maritime Commission, the Lend-lease Administration, and the
Office of Civilian Supply, consult with his own program experts, make
a tentative decision, clear it with Mr. Nelson if sufficiently important,

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and then issue orders to the materials divisions and to the industry
divisions, all of which were under his immediate direction, to operate
the industrial economy accordingly. Making the decision and carrying
it out were tied up in the same bundle, under one man.

The second important step in the new organization was the establishment
of the sovereignty of the materials and industrial divisions.
This was done through five administrative devices. First, the titles
were changed from "branch" to "division," an important step upward
in the semantics of Washington bureaucracy; second, each division
was given primary responsibility for maximizing the production in its
area, and for handling virtually all relations of the industry as such
with WPB; third, the division directed the flow of allocated materials
in its area, making specific allotments under the broad determinations
of the Requirements Committee and the program chairman, except
as these were covered by the claimant agencies; fourth, if the WPB
maintained order-board or scheduling control over the products of
any industry, the management of these were assigned to the appropriate
producing division; and finally, the division was made the point
of focus for reconciling competing demands, and for this purpose had
its own subrequirements committee, patterned after the parent
committee of claimants and was responsible for working out the total
program of requirements, production, allocation, and distribution.
The major divisions were also equipped with their own lawyers, labor
advisors, civilian requirements experts, and statisticians, all of whom
were assigned by the staff bureaus and offices under which they served.

The third important step in strengthening the operating divisions
was the curtailment of the defined responsibilities of the special program
units, such as those dealing with scrap and salvage, simplification
and substitution, redistribution and inventories, stockpiling and
shipping, resources protection, facilities and construction, concentration
of industry and civilian supply. These units were bluntly told
that they were from that time on "staff divisions," and that it was
their function to:

Advise the vice chairman, the director general for operations,
and their immediate subordinates.

Formulate policies, programs, plans, and procedures.

Advise and service the industry divisions and the regional offices.

Follow up the execution of functions in the industry divisions
and the regional offices.

Perform those phases of the functions where centralization
of performance in unavoidable.

Furthermore, it was specifically stated that "all performance phases
of the functions assigned to the vice chairman are carried out by the

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industry divisions and the regional offices, with minor unavoidable exceptions."

The fourth important step in building up the status of the operating
divisions, and perhaps the most important, was, however, Mr. Eberstadt's
methods of management. He meant what he said in the
new organizational order, and in his daily operations leaned heavily
on the materials and industrial divisional chiefs and their divisional
requirements committees to carry on the major operating functions of
WPB in Washington. Thus, under the November 11, plan, each
industry division became a small WPB in its own area, with its own
small requirements committee representing the chief claimants and
endeavoring to work out a balanced program within the overriding
decisions of the top requirements committee.

The Controlled Materials Plan

When Mr. Eberstadt originally took hold, the WPB system of
control over the flow of materials was undergoing transition from the
priorities system to the production requirements plan, described in
chapter 5. The essential element of PRP, as is shown below, was the
monthly allotment to each plant by WPB of the amounts of materials
required to meet its approved production schedules in view of its past
experience and its inventories. Beautiful as was this plan on paper,
it was under vigorous attack as administratively unworkable by some
large industrialists and by the chief claimants, particularly the Army
Service Forces. The PRP reports did disclose, however, large excess
inventories and had a beneficial effect on production in many quarters.

Nonetheless, the new vice chairman went immediately to work to
develop and enforce a new system of material control. In this he
had aid from several sources. The WPB Steel Committee returned
from England and reported on September 22, urging, among other
things, the adoption of the British system of steel allocations. At the
same time, a group of automotive engineers worked out and presented
a "warrant plan" under which each prime contractor would be given
warrants for the critical materials and components called for under
his war contracts. The services, in contrast, thought that the only
solution was to be found in giving each major claimant a fixed percentage
allocation of each critical material, and then leaving it to that
claimant to flow "his" material to the contractors working for him.
Mr. Eberstadt brought these various groups together behind locked
doors, including some British advisors who were flown over for the
purpose, and came out with a compromise and composite system
which was approved by Mr. Nelson and presented as the Controlled
Materials Plan on November 2, 1942, to become partially effective

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April 1, 1943, and fully effective July 1, 1943. Extensive CMP schools
were immediately organized both in Washington and in the field to
train WPB, Army and Navy representatives, and businessmen in
their new duties and the procedures under the Controlled Materials Plan.

Fundamental Principles of Production Control

In order to appreciate fully the significance of Mr. Eberstadt's
epochal reforms, it is necessary to view this last change against the
prior history of war-production controls, even at the risk of repeating
what has been chronicled earlier. Two elements are involved: first,
the strategy of control; i.e., where do you take hold of the economy?
And, second, the tactics of operation; i.e., how shall you mange
your controls?

The Strategy of Control.--The WPB program of November 1942,
like its predecessors, was based almost exclusively upon materials.
The new plan for managing the industrial economy, designed to get
out the maximum war production, was entitled the "Controlled
Materials Plan," the clearest possible recognition of its
central purpose.15

There are many other possible points of control in an economy, such
as contracts, appropriations, financing, production schedules and
utilization of power, transportation, plant and manpower. Of all
these, Mr. Eberstadt seized but one: materials and components, and
these he dominated by completely controlling steel, aluminum,
and copper, with other commodities added later. Under the CMP, the
whole industrial economy of America was steered by taking control of
these few key materials as a rudder. Virtually everything else was
expected to fall in place naturally and inevitably.

The tactics of operation.--There was an equally clear philosophy
back of the new technique of production control. This can best be
seen by examining the changing principles underlying American
production controls from 1940 to the Controlled Materials Plan
of November 1942.

In spite of the tremendous complexity of the American economy
and the involved nature of the war production controls which gradually

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came into being, the essential of the four kinds of control which were
established through the OPM and WPB are not difficult to understand
when stated in their simplest terms.

These four systems were:

Control by Priorities.

Control by Unrelated Allocation of short items by independent
materials and commodity divisions of WPB.

Control by Integrated Allocation under PRP by the Requirements
Committee and the WPB materials and commodity divisions.

Control by Integrated Allocation under CMP by the Requirements
Committee, working primarily through the Procurement
Agencies, namely, the Army, Navy, Air Forces, Maritime Commission, etc.

The accompanying diagrams
(charts 39
and 40) bring out the points
of contrast between the two latter systems. In both diagrams the
WPB organization is shown in skeletal form on the left. The key
function of the Requirements Committee is illustrated with the
responsibility for "cutting the material pie" among the various
claimants, and as the advisor of the program vice chairman and the
Chairman of WPB who had the final say.

The twelve "claimants," each with their own war or essential
civilian production programs, are represented by the four boxes to the right.

The circles which fill the bottom of the diagram represent in very
simplified form the tens of thousands of independent contractors, large
and small, who go to make up the American economy, most of whom in
one way or another did some direct or indirect war work.

The dotted black lines form the claimants to the circles, and
between the circles represent the prime contracts and their
subcontracts for war production.

Chart 39
shows the skeleton of the first effort that was made to
eliminate the confusion and inefficiency of unrelated priorities and
allocations by substituting a comprehensive and integrated system
of allocation. The system was known as the Production Requirements
Plan, because under it each producer was required to make a single
comprehensive statement to WPB of all his requirements on a monthly
and quarterly basis, as is explained in chapter 5. This flow of incoming
information on requirements is shown by the alternate dash lines.
After the total requirements as shown by these PRP statements had
been added up, the material pie was cut, and apportioned, plant by
plant, in the light of the total war production program, by the Requirements
Committee and the program vice chairman. Authorizations to

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Chart 39. General Scheme of Production Control Under Production Priorities Plan.

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buy and use critical materials were thus granted to every producer
direct from WPB.

These allocations, which went out chiefly through the WPB industry
divisions, were designed to take the place ultimately of both the
specific allocations and the flood of priorities.

This system was tried experimentally beginning in December 1941
and was made mandatory for some 10,000 larger war contractors
beginning with October 1942.

Chart 40
present graphically the CMP system which Mr. Eberstadt
installed, and which became effective in place of the PRP with the
first quarter of 1943, and was continued for 10 quarter years to
the end of the war.

Under this last development, requirements were gathered and stated
by the "claimants," the material pie was cut by the Requirements
Committee and the program vice chairman, and the stream of allocations
flowed down to the 12 major claimants as lump-sum allotments
under each of the controlled materials. Each claimant then made a
suballocation to this prime contractor; each prime contractor made a
further allocation to his subcontractors; and each subcontractor
allotted to his sub-contractor, to the final link of the chain. Thus,
the allocations followed the same lines as the contracts, and were
managed, within the broad totals set by the WPB, by each of the
major procurement agencies, the Army, the Navy, and Air Resources
Control Office, the Maritime Commission, and the Foreign Economic
Administration, etc.

There were, however, certain types of production which could not
well be handled through this distribution of allocations--the chain
was too long. Therefore, requirements for maintenance, repairs, and
operations of industries, including the mines and mills, and for the
civilian economy generally, were computed chiefly by the operations
vice chairman, and the allocations were enforced through this office
and through other divisions of WPB.
In chart 40,
the flow of incoming information on requirements is
shown in alternate dash lines, reaching the Requirements Committee
chiefly from the claimants; i.e., the procurement services. The allocations
are shown in lines marked "A," though only one set has been
filled in to avoid pictorial confusion.

Perhaps these diagrams will aid in making clearer the underlying
significance of the final evolution of the WPB material control techniques.

In passing from priorities to allocation, we passed from a queue
system, with the military program entitled to go to the head of the
line, to a rationing system, under which selected commodities were
separately rationed. In passing from these multiple allocations to

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Chart 40. General Scheme of Production Control Under Controlled Materials Plan.

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PRP, we passed from the unrelated rationing systems to a comprehensive
and integrated rationing system, under which allocations of one
commodity were related to allocations of another commodity, plant
by plant and program by program, under the complete administration
of the WPB itself. The final change was to shift the detailed administration
of allocations from the WPB to the claimant agencies, chiefly
the Army, Navy, Air Forces, and Maritime Commission, and to delegate
the secondary power of allocation to the prime contractors, who
passed the allocations on down through the industrial system.

The power which this transferred to the military services and to
the prime contractors, was, however, not quite as sweeping as these
diagrams indicate, because two other types of control not shown on
these charts were developing just as the final shift was being made in
the controlled-materials system. These two new areas of control were
scheduling and manpower allocation. The nature of these controls
is described below and in chapter 14.

Under the Controlled Materials Plan as thus worked out, the WPB
announced that it would "bring about the adjustment of production
programs to conform to materials supply" and that "each manufacturer
receiving an authorized order or authorized delivery schedule
for his product will receive an allotment of the materials which he
and his subcontractors must buy in order to fill the order."

Scheduling production.--The fourth answer for the problem of maximum
war production in a tight economy was the direct control by
WPB of the main military production programs. Direct control involved
three important activities: (1) sitting down with the military
chiefs, reviewing their programs, contracts, and production schedules,
and requiring them to make adjustments designed to get a better
over-all result; (2) sitting down with the managers of plants which
were producing the important military products, and authorizing or
directing them to take the necessary action in their own plants to get
out maximum production regardless of contracts, or the demands of
individual procurement officers and their expediters; and (3) taking
more or less complete control of the production schedules and deliveries
of the manufacturers of intermediate products like valves, ball
bearings, motors, crankshafts, and steel and aluminum alloys and
shapes; i.e., components.

The man selected by the President and Mr. Nelson to develop and
manage these production controls was Charles W. Wilson, president
of the General Electric Co.

Jurisdictional controversy.--When Mr. Wilson went ot work toward
the end of September 1942 on this important and difficult assignment,
he found it extremely difficult to get under way. The whole Washington
situation and the complicated division of work between the

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WPB and the services, and within WPB, were not only baffling, but
exasperating to a man fresh from the outside. The basic reason for
delay was, however, the loss by WPB of its powers over production
both through inaction and by the delegation of the contracting power
to the procurement services early in 1942. Thus, Mr. Wilson as
production vice chairman had to reassert and recapture the primary
authority of WPB over all production, a move the military authorities
resisted openly as well as covertly. Thus, while Mr. Eberstadt was
moving ahead rapidly with the backing of the Army, Mr. Wilson was
fighting a jurisdictional conflict over the basic powers of the WPB.
The ensuing interagency struggle between "coordinators" and "operators"
was labeled widely as another show-down fight between the
civilians and the military. The controversy ended in a compromise
under terms of which the WPB production vice chairman, Mr. Wilson,
was to be--

responsible for and . . . direct the scheduling of the various production programs
of the Army, Navy, Maritime Commission, and other agencies participating in
the national war production program, in order to ensure that program schedules
do not conflict, are in balance, are consistent with the maximum productive
possibilities of the national economy, and are in accord with the strategic requirements
of the Chiefs of Staff.

In discharging these functions with respect to end products and their
components, he was to have the advice and assistance of a Production
Executive Committee consisting of himself, as chairman, the WPB
program vice chairman (in charge of materials), the vice chairman of
the Maritime Commission, and two representatives each of the War
and Navy departments. His directives were to be issued through
the military supply services. In addition to these duties of general
supervision, the production vice chairman was charged with central
supervision and direction of the production programs for aircraft,
escort vessels, and radio and detection equipment. In dealing with
aircraft, he was to be advised and assisted by a board comprising
himself, as chairman, two representatives of the War Department,
and on eof the Navy Department. Again, he was to issue directives
through the supply branches of the Armed Forces.16

With the Production Executive Committee, Mr. Wilson had an
organization through which he could coordinate all production. But
the most immediate problem facing him involved only one small but
extremely important part of production, that of component parts,
such as valves or motors. For many vital programs, components
were relatively more scarce than materials. Thus, for example, there
might be ample supplies of steel for all the ships to be built for a particular
quarter, but insufficient valves or motors. Forgings, boilers,

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gages, heat exchangers, turbines, blowers, pumps, and bearings were
equally necessary for ships and the manufacture of airplanes, for
rubber factories, and the production of farm machinery. Unless the
production of components was carefully scheduled, and unless the
components themselves were distributed against immediate need,
proper allocation of raw materials did not prevent bottlenecks in production.

How difficult it was to schedule the production and delivery of
critical common components will be suggested by recalling the range
of these "middlemen of manufacture."

The components going into the finished products necessary for modern war
range all the way from minute jewel bearings for delicate instruments to huge
steel castings and forgings, from tiny fractional horsepower electric motors to
mammoth marine turbines, and many of these components, such as engines and
pumps, winches, motor controls, and axles, have subcomponents of their own,
each of which must be produced and delivered in proper quantity and on schedule
or some vital end product will be delayed.17

For this purpose, neither the Production Requirements Plan nor
the Controlled Materials Plan was adequate. These systems had
been installed to distribute materials among competing end-product
programs. They were not designed to assure the best detailed use of
components which continued to flow under the priority contracts.
Thus the new systems could not insure that orders for parts would be
filled in accordance with the relative urgency of various end-product
programs. A manufacturer with AA-1 ratings for more components
than he could supply at once was compelled to fill orders according to
the date he received them. As a result, the Navy, for example, might
get electrical equipment for ships which would not be launched for
another year while the Army waited its turn to have an order for an
urgent program filled. These problems were aggravated by the
armed services' underestimation of their requirements for components,
so that production was not increased soon enough to meet needs. in
addition, there was a tendency among claimant agencies to inflate the
amounts, and to advance the dates for delivery, of their end-product
and component needs, partly as a means to stimulate production.
In other cases, claimants and contractors failed to place orders early
enough to permit their production to be increased sufficiently and their
distribution to be scheduled properly.

To meet these difficulties, the War Production Board undertook to
obtain more timely determination of requirements and to scale them
down to actual needs to secure prompter placement of orders, to increase
capacity to produce components, and to effect better distribution
of available components. Even before the winter of 1942-43,

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the Board had been obliged to schedule production and distribution
of certain components in short supply, such as machine tools, compressors,
turbo-blowers, and jewel bearings. now it proceeded to
"codify" the process and to extend its coverage. This was done under
WPB General Scheduling order M-293 of February 26,
1943,18
and the Component Scheduling Plan of June 1, 1943, both of which later
underwent considerable revision, though their basic features remained.
Under these arrangements, WPB sought to determine more precisely
the actual requirements of claimants for components and to establish
and freeze firmly schedules for their production and delivery.

General Scheduling Order M-293 listed the critical components to
which delays in fulfilling end-product programs approved by WPB
had been attributed. On the basis of scarcity and need, these
components were grouped into three categories: undesignated, "X"
and "Y." Manufacturers of the first, and least critical, group were to
make regular operation reports to WPB, showing productive capacity,
and orders filled, received, shipped, canceled, and scheduled for
the specific period designated. Manufacturers of "X" items were
required to submit not only these operational reports but also delivery
schedules, and they were allowed to deliver components only under
schedules approved by WPB. Most items in the "Y" group, which
was the most critical, already were under WPB scheduling orders.
Anyone who wanted to place an order for one of these components
first had to obtain approval of WPB, which might specify the plant
in which it was to be placed. Orders so authorized had to be accepted
by the manufacturer if regular price and terms were met. Schedules
approved by the Board under Order M-293 could be "frozen"--I.e.,
protected from interference by rerating and expediting--through they
were subject to change by further WPB directives.

On the basis of information submitted on forms required for operation
of its Order M-293, WPB, through its industry divisions and
Production Scheduling Division, was able to determine expected production
and requested deliveries over a future period for a group of
manufacturers. It could transfer orders among plants making a
component if some were overloaded and others were operating below
full capacity. When total supply was not enough to meet total demand,
the Board tried to increase manufacture by eliminating labor
and material bottlenecks; and it undertook to correlate production
and distribution of components more closely with actual relative
urgencies of need.

To effect such correlation, it was necessary to determine the particular
end products into which the components were going and the
"lead time" required for each component of the products. For this

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purpose, the WPB industry divisions brought in representatives
of claimant agencies to go over the orders of component manufacturers
and to justify their orders on the basis of concrete end-product programs
and realistic time schedules. Results of this procedure, however,
were not enough ot meet the problem. The information needed for
adjusting schedules was not always available; and there was no
formal procedure to facilitate interchange of vital data about components
among contractors, claimant agencies, and WPB. To deal
with some of these deficiencies, the Board, on June 1, 1943, put into
effect its Component Scheduling Plan.

The Component Scheduling Plan (CSP) was a voluntary cooperative
scheme focused on critical components and subcomponents for a
limited number of military programs including ships, tanks, and
rubber plants. It introduced "vertical," as distinguished from the
prevailing "horizontal" or interplant, scheduling, a shift in some ways
analogous to that from PRP to COMP for control of materials. The
purposes of CSP were to develop realistic unit requirements for each
product and to identify the programmed items or projects for which
components on order were intended. Information on requirements,
contract numbers, and end products was transmitted by the prime
contractor to his subcontractors, by them to their subcontractors, and
so on.19
Each manufacturer in the contracting chain thus was given
the relation in time and quantity between the components he was to
supply and the end products into which they would go. These
arrangements facilitated verification of requirements and adjustment
of delivery schedules by WPB. Orders approved by the Board under
the CSP procedure could be frozen into schedules established under
WPB Order M-293.

General Scheduling Order M-293 was revised on September 17,
1943. To the three categories of components mentioned already, there
was added a "Z" classification consisting of items which had been
handled under the Component Scheduling Plan. The CSP procedure
was made mandatory by requiring contractors and subcontractors to
fill out CSP forms on instructions from claimant agencies. in addition,
certain "X" and "Y" components were moved into the undesignated
category in order to simplify reporting by manufacturers. Detailed
data were required only from producers in greatest difficulty and on
types and sizes of components which were most critical. In February
1944, the "Z" classification was dropped and the vertical scheduling
procedure for special programs was simplified because the paper burden
and time involved were found to make this system unworkable. At
the same time, procedures for reporting requirements for "X" components

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were simplified further. Those for "Y" items continued as
they were, but the number of components affected declined.20

Collision Between Production and Materials Controls

These developments in the scheduling of production and delivery
of components required adjustments in organization of the War Production
Board. The basic problem was to relate effectively the controls
exercised over manufacture of end products through distribution
of component parts with controls employed to allocate materials for
these products since, in many cases, both these elements of production
were critically short. It was desirable, for example, that production
schedules obtained by WPB should be in a form that would serve
both systems of control. It was important, also, that critical materials
and components both should be directed to the specific manufacturing
plants which would use them most promptly and effectively.
Within WPB, however, the two types of control were in separate
hands. The program vice chairman, Mr. Eberstadt, exercised authority
over allocation of materials, while the production vice chairman,
Mr. Wilson, had responsibility for production of end products
and components.21
The WPB Chairman recognized that these responsibilities
were "closely interwoven" and that "each official must
consult the other in many cases."22
He sought, therefore, to define
relations between them so that allotment of materials and scheduling
of production would be integrated properly; but circumstances were
such that this effort was not successful. WPB Chairman Nelson had
declared that the relation between the program and production vice
chairmen "has not and does not promote conflict."23
Neither such reassuring statements nor his instructions for consultation and
cooperation between the two officials, however, were enough to insure
the coordination that was needed in the war production program.
Apart from difficulties inherent in division of authority and provisions
for its coordination,24
there were other factors which interfered with

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integration of the two systems required for control of production of
end products. Among them were the presence in WPB of two "strong
men" in coordinate positions with closely related functions, the playing
of "palace politics" in the organization, and repercussions of
controversies between WPB and the military procurement agencies.

The potential frictions inherent in this situation came to a head in
a struggle for jurisdiction over WPB industry divisions. These units
were used for scheduling production as well as for allocating materials
(especially for CMP "B" products, which were common to many
end products)l Difficulties were almost inevitable in attempts by the
divisions to serve satisfactorily two masters who did not see eye
to eye: The program vice chairman, Mr. Eberstadt, had jurisdiction
over most of the divisions and was responsible for allocating resources
to end product programs. The production vice chairman, Mr. Wilson,
had responsibilities for production of these end products and their
components. The WPB Aircraft and Radio Industry Divisions and
the Office of Progress Reports had been placed under his direction
when WPB extended its control over production of these military
products early in December 1942.25
Not long after, Mr. Wilson sought
to have other WPB divisions put under his jurisdiction in order to
assist him more effectively in meeting his general responsibilities for
the war production program. He was reported to have complained,
for example, that the sizes and shapes of the raw aluminum supplied
under Mr. Eberstadt's direction were such that they could not be
turned in to the extrusions needed for production of airplanes under
his supervision.26
On February 4, 1943, WPB Chairman Nelson
transferred to the production vice chairman the Shipbuilding, General
Industrial equipment, Tools, Automotive, Safety, and Technical
Supplies, Aluminum and Magnesium, and Facilities Divisions and
the Facilities Bureau, all of which previously had been under the
program vice chairman.27
These shifts were a result of Mr. Wilson's
insistence and a recognition of the increasing importance of production
scheduling and the declining relative urgency of materials control in
the war supply program. The process was completed less than
2 weeks later when the WPB Chairman asked the program vice
chairman for his resignation and designated Mr. Wilson Executive
Vice Chairman in charge of functions formerly performed by himself
over production and by Mr. Eberstadt over materials.28
Chairman Nelson justified the reorganization with the argument that--

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Chart 41. United States Munitions Production.

Because our entire effort must now center about the production lines, and because
this involves the closest control over scheduling, it is essential that two things
be true--first, that a production man be in full charge; second, that all related
problems be within the jurisdiction of that production man.

. . . The man in charge of production cannot discharge his duties adequately
unless he also controls the flow of materials into production channels.

In other words, materials control and production control today are all one
integrated job. They cannot be considered separately. They must be directed
as one job, not two.29

Another element in the reorganization, however, was the relationship
between the WPB and the military. The latter were reported to be
seeking Mr. Nelson's ouster from the WPB chairmanship, and
Mr. Eberstadt, a former official of the Army and Navy Munitions
Board, was believed to be in sympathy with them.

With this final evolution, the WPB reached its ultimate wartime

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development and proceeded with new vigor and unity of direction to
drive production upward from month to month, until direct military
production reached toward the close of the year an annual rate of over
$62 billion, a figure previously considered impossible by many experts
and higher than the combined efforts of the other Allies.

4.
The Rubber Director reported directly to the PB Chairman even after the latter appointed an Executive
Vice Chairman. WPB General Administrative Order No. 2-80, Feb. 26, 1943. The Senate Special
Committee Investigating the National Defense Program declared that, as a result of the Petroleum
Administrator's direct responsibility to the President and of his complicated relations with the
WPB Chairman, "The lines of authority are confusing even on paper. As a practical matter
they breed disputes . . ."
Senate Report No. 10, 78th Cong., 1st sess., pt. 9, pp. 4-5.

8.
The production of synthetic rubber amount to 8,383 long tons in 1941, 22,434 in 1942, 231,722 tons
in 1943, and 753,111 in 1944. War Production in 1944, Report of the Chairman of
the WPB, June, 1945, p. 138.

10.
The Senate Special Committee Investigating the National Defense Program
remarked that "a rubber czar was set up, within the War Production Board, to be sure,
but still more or less autonomous" since, in spite of his responsibility to the WPB Chairman,
he "was given power himself to issue directives to the various agencies.
The Chairman of the War Production Board was requested by the Commander in Chief
to divest himself of concern with the rubber program. Therefore, practically speaking,
the Chairman of the War Production Board has had only tenuous authority over the
Rubber Director although technically he is the boss." Senate Report No. 10,
78th Cong., 1st sess., pt. 9, pp. 2-4.

11.
War Production Board. Wartime Production Achievements, and the Reconversion Outlook.
Report of the Chairman of WPB, Oct. 9, 1945, p. 11.

15.
The concentration of WPB controls in one area, namely materials, was accentuated by two other decisions
of Mr. Nelson during the latter part of 1942. These were the decisions: (a) to transfer out of WPB
such power as it might theoretically have exercised over the allocation of manpower, and (b) to relinquish
as far as possible power over food and agriculture. Closely as these problems were related to war
production, it was apparently Mr. Nelson's feeling that WPB should be kept as simple as possible, that it was
already "too big," and that his interests could be adequately protected by continuing to control materials
and by being represented on the advisory boards which dealt with manpower and with food and agriculture.
The transfer of these functions was effectuated in the fall and winter of 1942-43; Manpower by Executive
Order No. 9247., Sept. 17, 1942, 7 Federal Register 7379, and Executive Order No. 9279,
Dec. 5, 1942, 7 Federal Register 10177; Food and Agriculture by Executive Order No. 9280,
Dec. 5, 1942, 7 Federal Register 10179.

21.
Duties of the program vice chairman are stated in WPB General Administrative Order No. 265,
Nov. 11, 1942. those of the production vice chairman are include in WPB General Administrative
Orders Nos. 2-71, 2-72, 2-73, and 2-74, Dec. 9, 1942.

24.
The production vice chairman was to obtain the advice of the program vice chairman with respect to
(1) points at which proposed war production plans, programs, and schedules seemed likely to exceed
production possibilities because of material shortages, and 92) readjustments that might meet material
limitations effectively. He was to arrange with Army, Navy, and Maritime Commission that their schedules
and claims for materials should be in harmony with production plans, programs, and schedules he had
approved or released. Allotment requests submitted by these claimant agencies were to be reviewed by
the WPB Requirements Committee, Program Bureau, and Controlled Materials Division to determine
their consistency with production schedules approved by the production vice chairman and their relation
to total supplies of materials. When the program vice chairman made determinations for distrubtion of
materials that required reduction in approved production schedules, the production vice chairman was to
ensure that such schedules were adjusted appropriately. (WPB General Administrative Order No. 2-73,
Dec. 9. 1942.)